Gold futures closed higher Wednesday, driving the precious metal back above $ 1,800 in the penultimate session before a holiday break. Many global markets will be closed on Friday in observance of Christmas.
The advance for the precious metal helped it retake a precarious perch above $ 1,800 that it recently has failed to sustain for an extended period. But by midweek, a weaker dollar and subdued Treasury yields aided the yellow metal’s advance.
Bullion lost its grip on $ 1,800 over the past few sessions, amid choppy, low-liquidity trade leading up to the final trading days of 2021, which have been marked by concerns about the spread of the omicron variant of the coronavirus that causes COVID-19 and the reaction of global central banks to evidence of surging inflation.
After hitting a mid-November, near-term peak, gold futures mostly traded sideways, navigating the terrain between around $ 1,760 and slightly above $ 1,800 an ounce.
February gold GCG22, +0.83% traded $ 13.50, or 0.8%, higher to settle at $ 1,802.20 an ounce Wednesday, after settling 0.3% lower in the session before.
“Gold prices are figuring out its year-end trading range somewhere around $ 1800 and that should remain intact as trading volumes decrease,” wrote Edward Moya, senior market analyst at Oanda Corp., in a Wednesday note.
“Gold’s long-term outlook remains bullish as investors may have aggressively priced in Fed tightening for next year,” the analyst wrote.
Meanwhile, March silver SIH22, +1.16% was trading 29 cents, or 1.3%, higher at $ 22.819 an ounce, following a 1.1% advance on Tuesday.
The U.S. dollar was down 0.4% at 96.117, as gauged by the ICE U.S. Dollar Index DXY, -0.38%, and yields on the benchmark 10-year Treasury note yield TMUBMUSD10Y, 1.459% were down to around 1.46%. A stronger dollar and higher rates on risk-free Treasurys can lower the opportunity costs of owning precious metals that don’t offer a coupon.
For the week, gold is headed for a weekly decline of less than 0.1%, while silver is on pace for 1.1% gain thus far, FactSet data show, based on the most-active contracts.
In other metals, March copper HGH22, +1.00% picked up 4.55 cents, or 1%, to settle at $ 4.3915 a pound, after a 1.2% gain on Tuesday.
January platinum PLF22, +4.43% added $ 40.60, or 4.4%, to settle at $ 968.40, while March palladium PAH22, +5.01% traded $ 96.20, or 5.4%, higher to settle at $ 1,889.30 an ounce, after a 2.7% gain a day ago.